Let's just call it what it is: the ultimate tax break. The minimum wage is a tax break for those earning less than it. Increasing the minimum wage to $10 per hour as some have suggested will simply result in more blackmarket hiring. Maybe giving this tax break will help the US recover from some of it's current inequality spiral.

The minimum wage only hurts the people it is intended to help, weakens the economy, and promotes welfare and government dependance.

"In a free market, demand is always a function of price: the higher the price, the lower the demand. What may surprise most politicians is that these rules apply equally to both prices and wages. When employers evaluate their labor and capital needs, cost is a primary factor. When the cost of hiring low-skilled workers moves higher, jobs are lost. Despite this, minimum wage hikes, like the one set to take effect later this month, are always seen as an act of governmental benevolence. Nothing could be further from the truth.

When confronted with a clogged drain, most of us will call several plumbers and hire the one who quotes us the lowest price. If all the quotes are too high, most of us will grab some Drano and a wrench, and have at it. Labor markets work the same way. Before bringing on another worker, an employer must be convinced that the added productivity will exceed the added cost (this includes not just wages, but all payroll taxes and other benefits.) So if an unskilled worker is capable of delivering only $6 per hour of increased productivity, such an individual is legally unemployable with a minimum wage of $7.25 per hour.

Low-skilled workers must compete for employers’ dollars with both skilled workers and capital. For example, if a skilled worker can do a job for $14 per hour that two unskilled workers can do for $6.50 per hour each, then it makes economic sense for the employer to go with the unskilled labor. Increase the minimum wage to $7.25 per hour and the unskilled workers are priced out of their jobs. This dynamic is precisely why labor unions are such big supporters of minimum wage laws. Even though none of their members earn the minimum wage, the law helps protect their members from having to compete with lower-skilled workers.

Employers also have the choice of whether to employ people or machines. For example, an employer can hire a receptionist or invest in an automated answering system. The next time you are screaming obscenities into the phone as you try to have a conversation with a computer, you know what to blame for your frustration.

There are numerous other examples of employers substituting capital for labor simply because the minimum wage has made low-skilled workers uncompetitive. For example, handcarts have replaced skycaps at airports. The main reason fast-food restaurants use paper plates and plastic utensils is to avoid having to hire dishwashers.

As a result, many low-skilled jobs that used to be the first rung on the employment ladder have been priced out of the market. Can you remember the last time an usher showed you to your seat in a dark movie theater? When was the last time someone other than the cashier not only bagged your groceries, but also loaded them into your car? By the way, it won’t be long before the cashiers themselves are priced out of the market, replaced by automated scanners, leaving you to bag your purchases with no help whatsoever.

The disappearance of these jobs has broader economic and societal consequences. First jobs are a means to improve skills so that low skilled workers can offer greater productivity to current or future employers. As their skills grow, so does their ability to earn higher wages. However, remove the bottom rung from the employment ladder and many never have a chance to climb it.

So the next time you are pumping your own gas in the rain, do not just think about the teenager who could have been pumping it for you, think about the auto mechanic he could have become – had the minimum wage not denied him a job. Many auto mechanics used to learn their trade while working as pump jockeys. Between fill-ups, checking tire pressure, and washing windows, they would spend a lot of time helping – and learning from – the mechanics.

Because the minimum wage prevents so many young people (including a disproportionate number of minorit

Here's where theory and reality conflict. There's no concrete evidence that the minimum wage reduces employment. Some studies go one way, others another, and still others inconclusive. The general consensus among economists is that reduction in employment is unproven. Perhaps because minimum wages are too low to actually matter much.

Enforcing the minimum wage in this instance would mean going after *employers,* instead of just punishing the workers with deportation. Seize the assets of employers (to be paid as back wages to workers, "illegal" or not), and throw the employers in jail --- that'll stop under-the-table low wage labor much more effectively than occasionally deporting a group of workers (so the employers can move on to the next round of desperate, fearful immigrants, easy to exploit with bad wages).

So then corporations can decide the minimum wage. "Hey Pepsi, Coke, Nike, Walmart, etc. Let's set all of our wages to $1/hour. If workers don't like it, where else are they going to work? Surely, we'll get some crackheads that at least want a $1/hour." or, "Hey Boss, inflation and price of goods has risen quite high. Think we can all get a raise. (boss laughs hysterically)"

You can disagree with the minimum wage and suggest alternate systems, but I don't think it's a good idea to do away with it. Offer other solutions instead. Do we have a certain minimum wage for each class? Keep the minimum wage but do away with it for entry-level jobs of kids out-of-college? Then do companies only higher kids out-of-college for cheap labor and hurts everyone else over the age of 25?

It's like we're using a raft to stay afloat on water. All you say is that we should get rid of the raft. Well, now we're floating in shark-infested water. Can you offer some alternate solutions instead?

Sydney's cost of living is higher than where I live and our minimum wage is a dollar more/hour than in sydney.

The minimum wage is high enough that, if you work close to full time and are careful with money, you can live comfortably and provide good health/education for your kids.

If for some reason you can't get a job or can't work full time (eg: you are studying full time), then you will be eligible for various tax breaks and/or wealfare.

Also, income tax is almost non-existent if you earn minimum wage.

It does drive the cost of living up a bit, but only for services where labour is the primary cost - eg fast food is expensive here, because even 15 year old kids earn almost $10/hour on weekdays and often double that on weekends.

Most people, however, earn at least 30% more than the minimum wage.

Some bosses try to pay less, especially if they hire foreign tourists. And if an "employee" is a subcontractor there is no minimum wage (creating some grey areas). But a single disgruntled employee can call a dedicated government department to anonymously discuss or formally report these cases, and unless they keep it anonymous (good idea if you wanna keep your job) the boss is likely to end up in jail.

minimum wage is a good idea and should be tied to cpi. welfare what welfare. the government sells insurance and it's called social security, and while it is a pyramid scam for politicians to raid, it is still insurance not welfare. they got rid of most welfare. long ago, the problem is the government raided social security to give tax breaks to the rich in trickledown economics which is total bs. the rich don't 'trickle down' wealth they hord it, like the government does too (ever heard of fort knox). the only welfare left are corn subsudies (which benefit coke pepsi etc) and 'clean coal'/renewable energy grants. billionaires get huge tax breaks for not paying taxes in ireland, and other tax havens. it is sad, but individuals don't get welfare, and collecting social security is not accepting welfare, it is cashing in on an insurance policy. just like unemployment checks. and they deny your disability claims unless you hire a lawyer who can articulate your legitimate claim to disability, retirement checks are easier to get, but they keep creeping the age up, making up for corporations not having to pay their fair share of taxes, so the politicians raid social security funding.

the model of weath creation is to make the cheapest (without reducing quality) product while giving workers the best pay reasonable, but not all rich people follow that model, because they may make less individual wealth rather than wealth for the working class.

Why is it that all those eeeeevul companies don't already pay only the minimum wage? Could it be that companies like that actually have to compete for capable workers? The minimum wage mostly hurts first-job workers, low-skilled workers, and other marginal workers who can't compete for better jobs in the first place. Companies that rely on low-skill workers typically limit them to part-time so they don't fall into the minimum wage. Obamacare just makes that worse too.

Other solutions? How about making it less expensive to hire low-skilled workers?

Employers also have the choice of whether to employ people or machines. For example, an employer can hire a receptionist or invest in an automated answering system. The next time you are screaming obscenities into the phone as you try to have a conversation with a computer, you know what to blame for your frustration.

Machines get better every year, at just about everything, which means the value of low-end jobs is heading toward 0$. When all menial jobs can be done by robots, and everyone has already bought enough robots to do them, do we just let the unskilled die in the streets?

There are numerous other examples of employers substituting capital for labor simply because the minimum wage has made low-skilled workers uncompetitive. For example, handcarts have replaced skycaps at airports. The main reason fast-food restaurants use paper plates and plastic utensils is to avoid having to hire dishwashers.

It is not possible to pay a human being so little that they will be cheaper than an hour's worth of paper plates. The minimum wage didn't do that, the existence of machines that can produce paper goods that border on free did that. Lone vendors have always used paper, or just handed bare food to customers. The modern difference is that multi-billion dollar chains are now comfortable doing that to people who are sitting down in an actual restaurant.

As a result, many low-skilled jobs that used to be the first rung on the employment ladder have been priced out of the market. Can you remember the last time an usher showed you to your seat in a dark movie theater? When was the last time someone other than the cashier not only bagged your groceries, but also loaded them into your car? By the way, it won’t be long before the cashiers themselves are priced out of the market, replaced by automated scanners, leaving you to bag your purchases with no help whatsoever.

Usher is not the first-rung to anything. My grocery store has baggers who will help you load your groceries, but it is not the first rung to anywhere. Cashiers aren't going to be priced out by the minimum wage, they're going to be priced out by RFID scanners that record everything in your cart in five seconds, and run on five dollars in power per month. It's literally impossible for a human to compete with that. Should those humans die on the street? Even as things stand, these ladder-to-nowhere jobs don't pay enough for people to go to school on. The people who have them are stuck.

The disappearance of these jobs has broader economic and societal consequences. First jobs are a means to improve skills so that low skilled workers can offer greater productivity to current or future employers. As their skills grow, so does their ability to earn higher wages. However, remove the bottom rung from the employment ladder and many never have a chance to climb it.

Grocery baggers don't need to hone their skills for their employer's benefit. No one is going to get payed more for being a grocery-bagging gunslinger, travelling from store to store, fixing grocery bagging problems at exorbitant rates. The jobs that are "rungs" now require a college degree, and as education costs rise, anyone who isn't fully funded by their parents will find a degree effectively impossible to achieve.

So the next time you are pumping your own gas in the rain, do not just think about the teenager who could have been pumping it for you, think about the auto mechanic he could have become – had the minimum wage not denied him a job. Many auto mechanics used to learn their trade while working as pump jockeys. Between fill-ups, checking tire pressure, and washing windows, they would spend a lot of time helping – and learning from – the mechanics.

In the year 2013, where we live, Ma Kettle's Super Casual Gas & Go, where the attendant chews straw and learns repair on those dull, dusty days when cars are few, is not a thing. Gas stations are franchises. They al

A well done, post, but unfortunately empirical evidence contradicts most of your points.

There is no strong evidence that modest increases to the minimum wage reduces employment for low income people. One study in Florida showed an increase in youth employment after the minimum wage was increased.

The minimum wage may delay having workers replaced by machines, but eventually if the technology exists to replace a worker it is used.

Worker productivity has increased a huge amount since the 1970's, yet adjusted for inflation wages are stagnant. The increased productivity is being used to make the 1% richer.

Yes, lots of low paying jobs are gone, and more and more of them will disappear as technology improves. Another thing killing off low paying jobs is "the race to the bottom" where consumers demand the lowest possible price without thinking what that will do to service and quality.

Without a minimum wage, and lacking strong unions, wages drop to below a level that supports even a modest living unless there is a severe labour shortage. Outside of a few hot spots, when there is no minimum wage business takes advantage of it to suppress wages.

In the long run technology will doom capitalism as there will be no work for anyone. A different system, some sort of socialism most likely, will have to replace it.

The shitholes and companies that just want to maximize their profits pay minimum wage. In other words, they pay that little not because they can't afford more but because they can. More money for the owners. Raise the minimum wage and they'll pay it: there will be just a couple of percentage points decrease in the return to the owners.

Actually, I think minimum wage should be pegged to how much medical insurance costs. Back in the 90s when Globalisation was starting to take off, economists were on TV stating that our standard of living will increase because goods will fall in price.

Yep, big screen TVs have become a lot more affordable. In the meantime, medical care, college costs, and food prices have sky rocketed. And in the meantime, our standard of living has DECREASED. I lived a HELL of a lot better in the 90s than I do now!

Want there to be no min wage? Fine. Then let's outlaw the horseshit with the pharmaceutical companies gouging us in the States while giving the rest of the World a price break.

Let's stop this horseshit of college costs going through the roof.

Let's stop the AMA from blocking legislation allowing nurse practioners to do some of the GP work - like prescribing some drugs (the Georigia AMA is really bad here!). Medical costs CAN be reduced WITHOUT jeopardizing patient safety or health.

But like everything, the poor have very little say and the folks with the $$$$ have most of the say.

Many minimum wage workers begin getting raises within their first year or so of employment because they prove to be valuable assets to their employer and therefore their employer wants to reward them for their loyalty, productivity, and potentially a growth in skill set. This is how people move up the ladder. Minimum wage jobs are intended to be entry-level jobs. That's why they pay the lowest amount possible. They aren't intended to be careers but rather jobs that people entering the workforce can acquire due to their limited, or in some cases non-existent, skill set. This also means that many of the minimum wage workers are teenagers who don't have a family to feed and live at home. This means they don't need a high minimum wage due to their lack of responsibility to others. Their lack of skill set also doesn't justify starting out at a high wage.

So based on those statements, there isn't that many people left who are actually making just minimum wage after a year of employment who actually need a much higher wage due to having to support a family. So with that said, does raising the minimum wage for EVERYONE justify raising it for the very small subset of people who happen to be using the minimum wage job to support a family? No, it doesn't. A small subset of people will find themselves relying on a minimum wage job, sometimes to support their families, in the cases where they were laid off and couldn't find anything else or for those people who are near the end of retirement. Even if someone possesses a master's degree or has IT skills, those skills don't matter when flipping burgers, so someone who used to make $50k but got laid off and then who complains that they need $20/hr at McDonald's to support their family of 4 may as well expect to never get by with that job. There will be people who will work for less because they don't need to support a family because they are just a teenager who is applying for that job because it is indeed an entry-level job that requires no skills.

This doesn't mean I don't have compassion for those who need to support their families. If I didn't have compassion then I'd advocate making minimum wage $50/hr so that people making hamburgers and cashiers at walmart can get $100k a year just like other people who actually *have* skills deserving of $100k a year. But I understand economics too. I understand that if you keep having to pay someone more and more and not get anything more out of them for that higher cost (as in, more skills, more productivity, etc.) then they are more of a liability than an asset. Eventually, an employer will let that person go and make do with the other employees, OR, they will raise prices in order to still try earning profit in order to prevent the ENTIRE BUSINESS from collapsing due to employee costs that end up outweighing revenue thus equating to a loss of money. If that goes on for too long then the business closes up shop. THEN EVERYONE LOSES. So why would we want that?

Now, an employer who recognizes an employee is an asset, will move the employee to a higher paying position with MORE responsibility. But the original minimum wage job must still exist because there is still the need to have unskilled labor. There is nothing wrong with that. Kids and adults alike need to understand that there is a job for everyone; they are all important. I have worked my way up the salary ladder. I didn't expect $20/hr as a dishwasher. I knew I had to work my way up. For those who say, "but inflation makes things cost more". True, but you can thank the gov't (notice I didn't point to a specific president because there isn't one) for printing money that causes it to be worth less and therefore makes oil cost more and therefore fuel costs more. But when we raise the minimum wage they are just feeding the inflation fire because, as I said above, employers not only then have to contend with rising fuel costs (due to inflation and supply/demand changing) but now they have to continue thei

If sin taxes are implemented to reduce consumption of sinful tobacco and alcohol, and if import tariffs are implemented to reduce consumption of imports, and if politicians brag about this, then what do you think a tax on unskilled labor is going to do? And why do those same politicians act as if the reverse is true?

If it's good policy to raise the minimum wage to $9.00 from $7.25, and it will actually increase employment as politicians claim, why stop there? Why not raise the minimum wage to $15.00, or $50.00?

If you claim that those big raises are silly because they are patently destructive and unaffordable and ludicrous, then show me how you derived the $9.00 figure, which you claim to have the opposite effect?

You guys make it look like half the country earns the minimum wage. Nothing could be farther from the truth. Check the Department of Labor website and see for yourselves how few people actually work for the minimum wage. It's just a few percent of workers, and a good portion of those are teenagers, college students working part time, and second-income earners for a family.

It's just not that big a deal.

Why don't you instead look at the largest growth jobs? Minimium wage and $10/hr are exploding and growing by leaps and bounds. Walmart jobs, dollar stores jobs, fast food is where the industry is heading. UPS used to pay back in 1991 $20/hr for part time delivery jobs and distribution for the Christmas holidays. They now pay $9/hr without even being adjusted for inflation!

Also where you looking at the average salary that includes all the top 1%? Or the average salaried position? They have been declining year after year while inflation has grown 700%. The government is lying as CPI inflation index does not count insurance, food, energy, or housing! If you add these we have the 1970s since 1998 where it grows 10% year after year.

$40,000 a year was ok in 1998. Today if you add health care costs, food, and rent prices you can survive, but that is about it and be poor.

Please explain me your budget, because I do not believe you can live in a reasonnable way at that price. Here is a reasonnable but low budget according to expenses around where I live

rent 550 (that's 1 bedroom, I guess you could go for a studio)car insurance 35 (don't think you can drop under that for basic coverage mandatory in many states)car payement/repair 100 (that's quite low, about 1 low end new car in 10 years)internet 20 (that could be cut)home/cell phone 20 (that's the basic cell plan without internet)gas 50 (that's about 1 tank a month, if you live close enough to work or can use public transportation that should be enough)utilities 50 (probably depends on where you live)health insurance 150 (nothing below exist)clothing 50 (one reasonnable pair of shooes or a few shirts)food/grocery 300 ($10 a day)

that's 1325 a month which is over the minimal wage budget. I guess internet and cell phone could be cut. I guess you could go for a studio and cut rent a little bit. Health insurance could be cut but then welcome to medieval health care (though, the deductible will kill you with such a budget). Clothing could be cut in half certainly but not really easily (especially if you are a women). food/grocery might be reduced a little bit, but probably not more than to $8/day.

All the minimum wage does it make it illegal to work for less than X amount of money. Why should it be illegal for someone to work for $X if they choose it? No one is being forced into labor, anyone can choose whatever job they want to apply for.

If you think you're worth $30 an hour, don't work for less than that! Refuse to work unless you get the wages you want, whether that is $30 an hour or $3 an hour, but no business will hire someone if they get paid more than what they are worth, they're not a charity. The minimum wage essentially removes the bottom rungs on the "corporate ladder" making it harder and harder for less skilled people to find employment. Since they can't find employment, they can't get the skills to move up so they end up unemployed.

I don't think you've understood the gist of the post you are responding to. I am not advocating for either conclusion. More to the point since I am not advocating for the conclusion a minimum wage chokes employment it hardly falls to me to pick anything at all, does it?

Or perhaps you are only obeying the instructions in the penultimate sentence to the letter? Feels good, no?

Or what about a Dr. Wiley ending? One man who owns all the robots who do all the manufacturing, and that same man owns all the security robots. If nothing is done about wealth disparity, this is a possible ending. One man who owns everything... It'd make for good sci fi, or at least a good video game plot.

Many minimum wage workers begin getting raises within their first year 1 or so of employment because they prove to be valuable assets to their employer and therefore their employer wants to reward them for their loyalty 2, productivity, and potentially a growth in skill set. This is how people move up the ladder. 3

1) never seen that happen2) employers are not loyal (oh you ment employees... they get fired regularly)3) there are thousands of jobs where there is no ladder to move on (e.g. burger cooker at Mac Donalds)

I'm willing to bet this changed beginning with the recession, but if I recall correctly, there are very few adults with children working full-time and making minimum wage. I wish I had citation to back that up readily available, but to my recollection it was mostly young people just entering the workforce who made up a majority of the minimum-wage earners.

If that's still the case, way to grandstand on a non-issue, Mr. President.

>If it's good policy to raise the minimum wage to $9.00 from $7.25, and it will actually increase employment as politicians claim, why stop there? Why not raise the minimum wage to $15.00, or $50.00?

For the same reason that if it's better to give a dehydrated man 2 glasses of water instead of 1, it is not logical to give him 50 glasses of water. It is a complete logical fallacy to claim that because a small increase of something is better, any amount of increase is better. Try again.

What's the standard of living in your area? That has something to do with it. I mostly have the issue with a continually overreaching federal government, over which I have little influence and representation, dictating things that can be better handled at the state and local levels. It disgusts me that citizens are so used to this meddling behemoth that when they identify a problem, the first step is to demand that the federal government do it. Having a state or, even better, local government rectify the situation is something that's not only within their grasp but the equivalent of a drone strike as compared to carpet-bombing.

I'm also disgusted with the Slashdot moderators who think that having mod points means you just mod down posts you disagree with. Half of the parent post is vulgar and OT, but the GP post which was succinct, polite, accurate, and on-topic-- but gave the opposing opinion-- was modded down. This is immoral, and a total disgrace.

In other words, you want high unemployment for unskilled laborers. Most people don't seem to understand that the real minimum wage is $0. That's how much you earn when the minimum wage has priced you out of the job market. Couple that with recent reports about needing a bachelor's degree to get even low-skill jobs and soaring student loan debt, and you're looking at a major catastrophe for the lower & middle classes.

In other words, you want high unemployment for unskilled laborers. Most people don't seem to understand that the real minimum wage is $0. That's how much you earn when the minimum wage has priced you out of the job market. Couple that with recent reports about needing a bachelor's degree to get even low-skill jobs and soaring student loan debt, and you're looking at a major catastrophe for the lower & middle classes.

Making employers pay more for employees won't mean there's less work to do, and employers hire based off of how much work there is to do, not based on how much extra money they have in their pocket. You remove transportation costs and such. The economy won't suddenly implode when people make more money -- the worst that will happen is faster inflation, which really only hurts the rich if the minimum wage is tied to a decent metric.

I don't think I implied a mandate of any kind, and if it seemed that way, it was not my intent. What we can do is build and maintain an infrastructure and enact policy that leads to opportunities for improvement and either sustainability or growth in a community. Those that seek a better quality of life will be able attain it, or maintain what they have earned. That's why it's important to read the rest of the sentence and get to the point of "for a productive worker." The person has to appreciate the efforts required and choose success. We can't just mandate that every jackass and his mom gets a pony. But success has to be on the table as a possibility, right? It seems to me that you saw the phrase "minimum... quality of life" and balked without finishing. I held that up as the real aim of a minimum wage, and declared it as a starting point to get at our actual goals. I then demonstrated that the wage alone is totally inadequate. A mandated quality of life would be also be a horrible mistake, IMO.

However, if we have a regional economic system where a person (or couple) can work their ass off at three to five jobs and his/her family still starves, and the kids never see their parents so they get no discipline and a lousy education, what we have is unacceptable and unsustainable, and I have seen that very situation far more often than is acceptable in the past 6 years. I've also seen people on union benefits that don't do any work, and the benefit keeps them from moving on, and the union keeps them out of the work they used to do. More and more families are working hard and not seeing the rewards of their labor, or held back from the labor markets because they are not sustained by spending, and so stay on furlough. It's like digging a pit in the sand. People who work themselves to the bone and still have no security or acceptable quality of life (subjectively speaking, to their regional standard of living) should not be ignored as foolish or unlucky. People who cannot work because we are ignoring necessary work in some crazy ideal of austerity should be given the necessary work. They both should serve as a warning that these communities are failing, for whatever reason, and triage should commence.

We ignore that fact, because it is too hard, and either give out inadequate handouts in guilt (which break the bank in aggregate), or call such people foolish or lazy. None of that helps, because it's all orchestrated to our need to get on with our lives, blindly wishing that it will not reach unto us. We are ignoring a sleeping giant. There are too many people that have fallen down, and they will get back up. The only question is will they be carrying pitchforks and torches when that happens.

Ah, the great Keynesian fallacy. Little pieces of paper are what move and economy, not goods. That is why you can just print a piece of paper with a 1 followed by 16 zeros and solve all your economy's problems.

Let's make the minimum wage a million dollars an hour! The government can just send out million dollar bills to all the employers to pay those wages. Because you can print prosperity.

Nothing is further from the truth. Keynesianism supports the idea that goods and production and consumption are what matter, not little pieces of paper. The currency is simply a tool. When you have a recession caused not by destruction of productive capacity but by lack of demand (triggered by a financial crisis, for instance), then Keynesian stimulative policy can get some traction. Keynesian policy also means that when the economy is doing really well, austerity is necessary to keep inflation low and the economy from over-heating.

(Keynesian stimulus can be either monetary stimulus--i.e. quantitative easing--or fiscal stimulus--i.e. gov't spending and tax breaks... When you're at the zero lower bound like we are now, with a period of inflation lower than at any other period since the Great Depression and interest rates are also incredibly low--two things that aren't supposed to happen at the same time under monetarism but yet are right now--then regular monetary stimulus is pretty ineffective and because of the high unemployment rate--which is a pool of unused productive capacity--your best bet is fiscal stimulus which IS effective even when monetary policy is exhausted but fiscal stimulus is apparently not politically "serious" enough.)

Just so we're clear, all the fiscal stimulus is doing is not "magical," it's just putting idle resources--unemployed workers and capital--to work.

But again, you seem to have your straw man pretty well established, sorry for disrupting it...